Tech majors urge no to Title II for broadband

With Federal Communications Commission (FCC) Chairman Tom Wheeler on the verge of releasing new open Internet rules, 60 of America’s top technology companies have sent a letter to FCC Commissioners and Senate and House leaders urging them to reject reclassification of the Internet under Title II. The companies warn in the letter that Title II reclassification could mean a loss of up to $45.4 billion in capital investment over the next five years.

The signatories – leading technology companies and equipment manufacturers such as Cisco, Intel and IBM – warn that reclassifying broadband as an outdated Title II phone service, a much stricter regulatory regime than the one currently in place, would threaten new investment in broadband infrastructure and jeopardise the economic power and jobs created by America’s tech industry. The letter’s signatories are the companies building the Internet and bringing this “dynamic” network to consumers and businesses in every part of America.

“The robust support for this letter demonstrates that Title II is a significant threat to the tech companies that build and support the Internet,” said Scott Belcher, CEO of the Telecommunications Industry Association (TIA), which organised the letter. “These companies are at the heart of our economy, and are driving the innovation and investment that has made the Internet the revolutionary force it is today. This letter sends an unambiguous message that reclassifying Title II would be detrimental to today’s Internet, harming consumer, job creation and economic growth.”

The companies suggest that the current restrained regulatory framework has propelled the growth of broadband across America, leading to more than $1.3 trillion of investment into broadband networks and note that Title II reclassification would dramatically reduce investment in broadband networks, leading to a loss of up to $45.4 billion in capital investment over the next five years.

“Title II would lead to a slowdown, if not a hold, in broadband build out, because if you don’t know that you can recover on your investment, you won’t make it,” the group wrote in its letter. “The investment shortfall would then flow downstream, landing first and squarely on technology companies like ours, and then working its way through the economy overall. Just a few years removed from the worst recession in memory, that’s a risk no policymaker should accept, let alone promote.”

With past progress in mind, the companies cautioned: “Our companies and our employees – like the consumers, businesses, and public institutions who depend on ever-improving broadband networks – would be hurt by the reduced capital spend in broadband networks that would occur if broadband is classified under Title II. Such a dramatic reversal in policy is unnecessary to ensure an open Internet.”